Warner Bros. May Buy Flixster – What’s With All the Embracing the Future?

The major studio is getting all new media; now comes a report that it may buy Flixster, with its 20 million users

Last Updated: April 1, 2011 @ 5:25 PM

What’s happening over at Warner Brothers? The major studio has warmed to the heat of the digital age.

After expanding the studio’s offering of movie rentals on Facebook, now comes word that the major is in talks to buy Flixster, one of the unsung gems of new media.

Update on Tuesday: An individual with knowledge of the deal said that talks were ongoing but that it was "not a done deal."

The site, with 20 million registered users, is one of the most popular movie social media sites with the tagline: “Watch movies. Tell friends.” Genius.

The incipient purchase, first reported on Monday by AllThingsD, is being driven by the new co-president Kevin Tsujihara and Warner’s digital chief Thomas Gewecke (pictured below).

   Writes Kara Swisher: “Warner Bros. appears to be the frontrunner in various talks to buy the entertainment site, while Internet giant Yahoo has dropped out due to price concerns.”

Swisher reports that the debated price has varied between $60 to $90 million.

WaxWord thinks this is an exciting idea; we’ve been militating for a Hollywood studio to make a major move into the new media space. And who’da thunk that the hidebound Warner Bros. – with its top-heavy structure and old media culture – would be the ones to make a bold move? (Though a: the deal is not done and b: it’s still not nearly as daring as buying Netflix would be.)

Read also: Calling Netflix or Huffpo: After 2010, Hollywood Needs a Gamechanger

Gewecke is the guy who has been driving the studio’s foray into social media on Facebook, having advocated for the rental experiment over Facebook. That went well enough with “The Dark Knight” at $3 a pop for the studio to expand the offering into other major titles, including the “Harry Potter” series.

What does he have in mind with Flixster? If nothing else, it’s a new, vast pool of movie-lovers to whom he can sell/rent/promote Warner’s vast, and increasingly underused library.

Tsujihara, meanwhile, is the executive who has presided over the debilitating decline in home entertainment revenue. The declines have been double-digit every year for the past few, and the decision to move into social media is most certainly fuelled by the panic over the declining DVD dollars.

For some time, Warner has been trying to develop technology that would put the movie genie back in the streaming bottle by creating products that would allow customers to download movies to a hard drive and keep them, library-style.

The foray into Facebook – charging users $4 in Facebook credits for more recent titles – suggests a recognition that streaming is a platform that is here to stay.

Meanwhile, the purchase of Flixster – which recently bought Rotten Tomatoes, the leading aggregator of movie criticism – would give Warner Bros. access to an audience of more than 20 million registered users as it seeks new ways to promote and distribute its movies online.

Flixster was founded in 2006 by Joe Greenstein.

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